The Supreme Court Ok’s CSAPR, but Implementation Remains Stalled

May 6, 2014

Reading Time : 4 min

To solve this problem, the EPA first developed a procedure for determining when a state “contribute[s] significantly” to a downwind state’s non-attainment of a relevant NAAQs.8  First, the EPA excluded as de minimis any impacts that resulted in less than 1 percent of the NAAQs  in any downwind state.  States with only de minimis impacts were excluded from regulation under CSAPR.  For the remaining 27 states, the EPA developed an “emissions budget” using a complex model.  This model took into account not only the emissions produced by each state and its contribution to downwind pollution, but the amount of reduction that could be achieved at certain cost thresholds.

In EME Homer City Generation v. EPA,9 the D.C. Circuit vacated CSAPR on two primary grounds.  First, it found that it was unfair to the states to expect that they would develop their State Implementation Plans (SIPs) without knowing what their obligations were under the Good Neighbor Provision. Under the CAA, a state must propose a SIP within three years of the EPA issuing new NAAQS.10  If the EPA judges that a SIP is inadequate, then within two years it must issue a Federal Implementation Plan (FIP) for that state.  But CSAPR was promulgated after the states had submitted their SIPs.  When the EPA promulgated CSAPR, it deemed those existing SIPs inadequate with regard to the Good Neighbor Provision, and simultaneously issued FIPs. 

The second issue on which the D.C. Circuit vacated CSAPR was the allocation of emissions reductions among the upwind states.  The D.C. Circuit concluded that the EPA’s method, which took into account the cost-effectiveness of reduction measures, was not supported by the statute.  The D.C. Circuit held that the EPA must require that states reduce their emissions by an amount strictly proportional to the amount to which they contributed to their downwind neighbors’ non-attainment of NAAQS.

The Supreme Court, in a 6-2 opinion written by Justice Ginsburg, disagreed (Justices Scalia and Thomas dissented, and Justice Alito recused himself).  With regard to the SIPs, the Court concluded that the plain text of the statute supported the EPA’s issuance of FIPs concurrently with CSAPR, because the EPA’s power to issue a FIP adheres when it finds a SIP inadequate.  The EPA may have two years in which to issue a FIP, but it can do so immediately if it so chooses. 

With regard to the allocation of the emissions budgets, the Supreme Court found that the EPA’s cost-based approach was a permissible reading of the statute.  A strictly proportional approach would likely result in “over-control” of emissions, and would be more costly than the EPA’s approach.  In particular, the Court was concerned that a strictly proportional approach would harm states that have higher emissions due to a higher population or more industry, but that have already implemented costly pollution control measures.  In a proportional approach, those states would have to implement even more expensive measures to achieve incremental reductions in emissions, while a neighboring state that had not yet implemented less expensive measures could continue to “free-rid[e] on their neighbor’s efforts to reduce pollution.”11

The Court did agree, however, that there were limits.  A state cannot be required to reduce its emissions below the de minimis threshold of a 1 percent contribution to the NAAQS of any downwind state, nor can it be required to reduce its emissions below that required to bring any downwind state into attainment.  States are free to file as-applied challenges to CSAPR on that basis.

Although EPA v. EME Homer City Generation represents a victory for the EPA, it is unclear if the decision will have any practical effect in the near future.  The Supreme Court remanded the case to the D.C. Circuit, where outstanding issues in the case remain to be resolved, including whether a FIP can be imposed on a state for which a SIP had been approved under CSAPR’s processor regulation.  CSAPR will likely remain stayed until those issues are resolved.  Moreover, there are multiple other outstanding legal challenges to aspects of CSAPR in the D.C. Circuit and elsewhere that have not been consolidated with Homer City and must also be resolved.  The implementation schedule in CSAPR has also passed; the EPA will have to establish a new one prior to the regulation going into effect.  Meanwhile, changes in the industry, including the increasing use of natural gas, have changed the amount and kind of emissions from that used in the EPA’s CSAPR model.

The EPA may have a regulatory framework, but it still lacks a functional cross-state air pollution regulation.  Neighborliness will have to wait. 


1 Id. §§ 7401-7671q (2011).  

2 42 U.S.C. § 7410(a)(2)(D)(i) ( a state implementation plan shall include provisions “prohibiting . . . any source or other type of emissions activity within the State from emitting any air pollutant in amounts which will . . . contribute significantly to nonattainment in, or interfere with maintenance by, any other State with respect to any such national primary or secondary ambient air quality standard.) (“Good Neighbor Provision”).

3 See Michigan v. EPA, 213 F.3d 663 (D.C. Cir. 2000); North Carolina v. EPA, 531 F.3d 896 (D.C. Cir. 2008).

4 Federal Implementation Plans: Interstate Transport of Fine Particulate Matter and Ozone and Correction of SIP Approvals, 76 Fed. Reg. 48,208 (Aug. 8, 2011) (codified at 40 C.F.R. pt. 51, 52, 72, 78, 97).

5 EPA v. EME Homer City Generation, L.P., No. 12-1182 (U.S. Apr. 29, 2014).

6 Id., slip op. at 3.

7 Id. at n.1.

8 The NAAQs at issue are those for ozone and fine particulate matter; however, CSAPR does not regulate the emissions of those substances but rather their upwind precursors, nitrogen oxide (“NOx”) and sulfur dioxide (“SO2”).

9 EME Homer City Generation v. EPA, 696 F.3d 7 (D.C. Cir. 2012).

10 42 U.S.C. § 7410(1)(1).

11 EPA v. Homer City at 27.   

Share This Insight

Previous Entries

Speaking Energy

June 25, 2025

On June 4–5, 2025, the Federal Energy Regulatory Commission (FERC or Commission) hosted a commissioner-led technical conference to discuss resource adequacy challenges facing regional transmission organizations and independent system operators (RTO). The conference is a response to the growing concern that multiple RTO regions across the country may not have sufficient supply available in the coming years to meet demand due to resource retirements, the pace of new generation entry and higher load growth arising from the construction of data centers and reindustrialization.

...

Read More

Speaking Energy

June 12, 2025

We are pleased to share the presentation slide deck and a recording of Akin’s recently presented webinar, “Navigating U.S. Policy Shifts in the Critical Minerals Sector.”

...

Read More

Speaking Energy

June 10, 2025

On June 4, 2025, the U.S. Department of Transportation’s (DOT) Pipeline and Hazardous Materials Safety Administration (PHMSA) announced revisions to its procedures for pipeline safety enforcement actions. The changes, outlined in two new policy memoranda from PHMSA’s Office of the Chief Counsel (PHC), aim to enhance due process protections for pipeline operators by clarifying how civil penalties are calculated and expanding the disclosure of agency records in enforcement proceedings.

...

Read More

Speaking Energy

May 22, 2025

On May 19, 2025, the Department of Energy (DOE) finalized its 2024 LNG Export Study: Energy, Economic and Environmental Assessment of U.S. LNG Exports (the 2024 Study) through the release of a Response to Comments on the 2024 Study. The Response to Comments concludes that the 2024 Study, as augmented through public comments submitted on or before March 20, 2025, supporting a finding that liquefied natural gas (LNG) exports serve the public interest. With the comment process complete, DOE will move forward with final orders on pending applications to export LNG to non-free trade agreement (non-FTA) countries.

...

Read More

Speaking Energy

May 20, 2025

On Thursday, May 15, the Senate Commerce, Science & Transportation Subcommittee on Surface Transportation, Freight, Pipelines and Safety held a hearing titled, “Pipeline Safety Reauthorization: Ensuring the Safe and Efficient Movement of American Energy.” The hearing examined legislative priorities for reauthorizing the Pipeline and Hazardous Materials Safety Administration (PHMSA).

...

Read More

Speaking Energy

April 15, 2025

On April 9, 2025, President Trump issued an executive order (EO)1 directing several federal agencies and subagencies that regulate energy, environmental, and conservation matters,2 including the Federal Energy Regulatory Commission (FERC) and the Department of Energy (DOE), to establish conditional sunset dates for “regulations governing energy production.” The stated objective of the EO is to require agencies to periodically reexamine their regulations to ensure that they continue to serve the public good. For FERC, the order covers regulations promulgated under the Federal Power Act (FPA), the Natural Gas Act (NGA) and the Powerplant and Industrial Fuel Use Act (FUA)3, as amended, while DOE must consider regulations promulgated under the Atomic Energy Act (AEA), the National Appliance Energy Conservation Act, the Energy Policy Act of 1992 (EPAct 1992), the Energy Policy Act of 2005 (EPAct 2005) and the Energy Independence and Security Act of 2007 (EISA), as amended (collectively the Covered Regulations).4 To the extent the DOE has been directed to promulgate regulations under various sections of the NGA, FPA and FUA, and FERC has been directed to promulgate regulations specific to the statutes attributed to the DOE in the EO, the EO is silent. The EO expressly does not apply to those “regulatory permitting regimes authorized by statute.”5

...

Read More

Speaking Energy

April 10, 2025

On April 8, 2025, President Trump issued an Executive Order (EO) directing the Department of Energy (DOE) to take steps to expand the use of its emergency authority under Federal Power Act (FPA) Section 202(c) to require the retention of generation resources deemed necessary to maintain resource adequacy within at risk-regions of the bulk power system regulated by the Federal Energy Regulatory Commission (FERC).1 The EO appears to envision a more active role for DOE in overseeing and supporting the resource adequacy of the grid that deviates from the historic use of Section 202(c) and touches on issues at the intersection of state and federal authority over resource planning.

...

Read More

Speaking Energy

March 10, 2025

On March 5, 2025, the United States Department of Energy (DOE) approved Golden Pass LNG Terminal LLC’s (GPLNG) request to extend a deadline to begin exporting liquefied natural gas (LNG) from its terminal facility currently under construction in Sabine Pass, Texas for 18 months, from September 30, 2025, to March 31, 2027 (the Order). The Order amends GPLNG’s two existing long-term orders authorizing the export of domestically produced LNG to countries with which the United States does and does not have free trade agreements (FTA).1  The Order does not amend the authorizations’ end date, which remains December 31, 2050. Under section 3 of the Natural Gas Act (NGA), the DOE may authorize exports to non-FTA countries following completion of a “public interest” review, whereas exports to FTA countries are deemed to be in the public interest and the DOE is directed to issue authorizations without modification or delay.

...

Read More

© 2025 Akin Gump Strauss Hauer & Feld LLP. All rights reserved. Attorney advertising. This document is distributed for informational use only; it does not constitute legal advice and should not be used as such. Prior results do not guarantee a similar outcome. Akin is the practicing name of Akin Gump LLP, a New York limited liability partnership authorized and regulated by the Solicitors Regulation Authority under number 267321. A list of the partners is available for inspection at Eighth Floor, Ten Bishops Square, London E1 6EG. For more information about Akin Gump LLP, Akin Gump Strauss Hauer & Feld LLP and other associated entities under which the Akin Gump network operates worldwide, please see our Legal Notices page.